Work detail

Two essays on inflation targeting

Author: Mgr. Matějů Jakub
Year: 2011 - summer
Leaders: prof. Roman Horváth Ph.D.
Consultants:
Work type: Doctoral
Economic Theory
Language: English
Pages: 80
Awards and prizes:
Link:
Abstract: The thesis consists of two essays on inflation targeting. The first essay examines how
do monetary authorities set their inflation targets. Survey of central banks' communication
regarding the target is presented, theoretical model is developed and finally empirical analysis is
conducted on a panel of inflation targeting countries. This pioneering analysis of the topic leads
us to conclusion that inflation targets are influenced by more variables than central banks admit.
In addition to past and foreign inflation, inflation variability and GDP growth we find significant
impact of central bank credibility and other institutional factors. The short second essay surveys
literature assessing performance of inflation targeting and outlines perspectives of inflation
targeting as a monetary policy framework. The conclusion is that if inflation targeting central
banks stick to their best practice in transparency and communication and remain open to
innovations, inflation targeting will have a good chance to score well even in the periods of
turmoil.
Downloadable: Rigorous Thesis Matějů

Partners

Deloitte

Sponsors

CRIF
McKinsey
Patria Finance